Community Bankers of Wisconsin Inc

PART X, LINE 2:

“The association files forms 990 and 990-t in the u.s. Federal jurisdiction and form 4t in the state of wisconsin. With few exceptions, the association is no longer subject to examination by the internal revenue service for years before 2010 (2008) and state examination by tax authorities for years before 2009 (2007). Financial services files income tax returns in the u.s. Federal jurisdiction and state of wisconsin. With few exceptions, financial services is no longer subject to examination by the internal revenue service for years before 2010 and state examination by tax authorities for years before 2009. Deferred income taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences, operating losses, and tax credit carry forwards. Deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Deferred income taxes are provided when necessary for all the taxable for-profit members of the consolidated group. When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying consolidated statement of financial condition along with any associated interest and penalties that would be payable to the taxing authorities upon examination.”